Rep. Mike Ross Responds to ProPublica-Politico Investigation of Pharmacy Sale
"This style of gotcha politics is why many folks are fed up with Washington and it is a shame serious debate on reform has, once again, fallen off course. Instead of having civil dialogue over true and substantive disagreements about reforming our broken health care system, outside groups are trying to taint a completely legal and respected small business that my wife and I worked hard for 14 years to establish.
When we sold our family business, Holly's Health Mart, over two years ago, we reported and disclosed all the transactions required by the House Ethics reporting requirements. I also accurately reported the property on my personal financial statement in 2007, when I sold the business. I sold it for the amount that I have indicated it was worth on every personal financial statement since 1999. I spent $316,000 in 1998 constructing the building that houses the pharmacy and sold it for $420,000 in 2007 – the annual return on investment is less than four percent. I would have made more during that time period if I had invested in a certificate of deposit (CD).
I have never done a favor for the buyer, who I have only met a few times in my life. The buyer did not just buy brick and mortar; he bought a successful, trusted, centrally-located and profitable pharmacy in my hometown. In two of my closest races, the buyer supported my Republican opponent in both of them. He has since supported my campaign.
I welcome any debate and review on my voting record and my positions on the issue. I have said all along that we need health care reform in this country; in fact, I ran for Congress to address our broken system. It is for these reasons why I supported health care reform legislation in the Energy & Commerce Committee in order to ensure that we could move forward with the legislative process and give Members of Congress time to read the bill and talk it over with their constituents. We need common sense health care reform that reduces costs, increases access, forces insurance companies to cover pre-existing conditions and protects patient choice. My ultimate goal has always been to pass a health care reform bill that will offer the kind of reforms I can support – a common sense plan that reflects Arkansas values.”
Responding to the congressman’s statement, Paul E. Steiger, editor-in-chief of ProPublica, said:
"The issue here is not whether Rep. Ross filed the proper disclosure forms. Nor is it whether Rep. Ross earned a large or small return on his initial investment in the building. The issue is whether the Congressman received more on the sale of his building than someone without his power and influence would have received for selling this building. As we read his statement, Rep. Ross does not deny that he received significantly more than an arms-length fair-market price for the building -- on top of the very considerable sums he and his wife received for selling and continuing to run the business."
Rep. Ross states that the buyer bought more than “brick and mortar” for their $420,000, that they also bought "a successful, trusted, centrally-located and profitable pharmacy in my hometown." But, as the story noted, the buyer paid an additional $500,001 to $1 million for the business, as well as between $100,001 and $250,000 for agreement not to compete against the new owners. Those payments brought the total value of the transaction to between $1 million and $1.67 million.
Rep. Ross declined numerous requests for interviews over a two-month period to discuss the transaction in question. He still has not disclosed whether he has discussed the pending health care reform legislation with the buyer, who owns a large chain of drug stores and has a clear and pointed interest in the outcome of the health care legislation.